Formulation of Oligopolistic Competition in AC Power Networks: An NLP Approach

In this paper, oligopolistic competition in a centralized power market is characterized by a multi-leader single- follower game, and formulated as a nonlinear programming (NLP) problem. An AC network is used to represent the transmission system, and is modelled using rectangular coordinates. The follower is composed of a set of competitive suppliers, demands and the system operator, while the leaders are the dominant suppliers. The AC approach allows one to capture the strategic behavior of suppliers regarding not only active but also reactive power. In addition, the impact of voltage and apparent power flow constraints can be analyzed. Different case studies are presented using a three-node system to highlight the features of the formulation. Results on a fourteen-node system are also presented.